Contracting in Public Transport in Warsaw

Contracting in public transport in Warsaw

Maciej Florczak Warsaw Transport Authority (ZTM) Legal aspects

• According to the Polish national law municpalities are responsible for urban public transport system within their administrative borders

• Warsaw Transport Authority (ZTM) is the only representative public entity of the City of Warsaw established to manage the public transport system (budgetary entity)

• The national law allows municipalities to cooperate e.g. in urban transport area

Tasks of ZTM

• Planning, organizing and coordination of public transport (network, timetable, etc.) in Warsaw and surrounding area • Ordering Public Transport (PT) services from operators (bus, tram, metro, railway, bike sharing) • Supervision over actual PT functioning • Selling tickets and ticket controlling (revenues supply the budget of the City not the operators) • Investments in PT development projects and some transport infrastructure • Ordering and taking part in studies and projects concerning development of PT • Collecting data and providing analyses according to the demand of PT services • Infrastructure maintenance (bus and tram stops, P+R)

1,9 million

0,75 million Modes of transport (2014)

12%

vehicle-km metro 26 379 922,600 railway 19 304 057,258 tram 51 597 337,000 55% buses 116 067 475,716

24% trains metro tram bus

M M M M P R

M – municipal Local lines R – regional in communities P - private Service contracting: - In-house contracts (gross-cost)

- Procurements for long-term service (gross)

- Procurements for short-term service (net-cost)

Contracts share (2014)

15%

vehicle-km in-house 178 519 586,556 private gross-cost 32 191 674,762 private net-cost 2 637 531,256

84%

In-house contracts and EU funds 2007-2013 In-house contracts

Warsaw Metro Ltd Warsaw Trams Ltd Warsaw Buses Ltd Urban Rail Ltd

2009 -2027 2008 -2027 2010 -2017 2010 -2025

100 % City-owned companies • Long-term, in-house contracts with municipal operators are the basis for investments

• Operators were obliged to invest in the fleet/infrastructure according to the specific requirements included in the text of the contracts

• Fleet belongs to the operator

• Contracts are similar to those signed with private operators e.g.: - gross-cost contract – Fixed amount of vehicle-kilometers - requirements and penalties

Performance indicators

• Punctuality

• Reliability

• Comfort of travel

• Passenger information

• Technical standards of vehicles

• Cooperation with ZTM traffic management

Penalties

Examples from the penalties catalogue: • Delay caused by the operator • Lack in the passenger information system • Lack in the esthetics of the vehicle (dirty seats, windows…) • Technical irregularities – validators, door opening, air-conditionig • Incorrect outfit of the driver • Smoking in the vehicle • Usage of the mobile phone • Lack of essential documents • And many others….

• Costs of investments are included in the compensation level

• Municipal companies are allowed to apply for EU financing

• EU funds have an influence on the compensation level (annual review of the compenstion rate)

• Operators are allowed to take loans for the investments

„Support contract”

• Contract between the City, operator (borrower) and finance party (e.g. EIB)

• Defines the rules and circumstances of the support of the City given to the operator

• Defines the investments programme

• Puts duties on the City

Obligations of the City (Warsaw Trams Ltd)

• The City is obliged to support the operator in all administrative procedures • The City has to keep the strong position of tram service in public transport system • The City cannot establish any other municipal operator • The City cannot change the public service contract with the operator (except small, operational changes) without the permission of financial parties • The City will not put any additional duties or charges on the operator which can decrease its the creditworthiness

Metro line 2

• 6,5 km of tunnel with 7 stations

• 35 new trains (Inspiro Siemens)

• Total cost of the procjet: 5,9 billion zł

• EU refund: 52,4% Urban Railway Ltd

• Purchase of 13 trains (Chopin airport service)

• Purchase of 10 trains (other lines)

• Total cost of the procjet: 596 000 000 zł

• EU refund: 47 % Warsaw Trams Ltd.

• Set of track investments

• Total purchase of 186 trams

Competetive tendering

What we have learned? Long-term private contracts (gross-net)

Mobilis group PKS Grodzisk Maz. ITS A.Michalczewski 2007 - 2016 2007 -2017 2006-2015 2008 - 2016 2007 -2017 2010 - 2018

+ some which expired Competetive tendering (in the past)

Why?

• The need to reduce the costs of bus service (in comaprison to municipal operator)

• The need to improve vehicles standards (in comparison to municpal operator [MZA])

• To encourage the public operator (MZA) for changes and modernisation

• „Cheaper & better” Competetive tendering

• Gross-cost contract

• Procurement for specific vehicle-kilometers amount

• The organizer defines the standards of the fleet

• The organizer (ZTM) defines the schedules, rouets etc.

• The operator manage the employees and maintenance facilities

• The price per vehicle-kilometre is the only criterion for selection

What we have after the years?

• Deacreasing standard of service

• Enormous lacks in the maintenance of the vehicles

• Defects fixed with „tape”

• Drivers hired on poor conditions

• Foreign drivers without knowledge of the language

• Incidental lack of service

Some statistics (2014)

Penalties for incorrect passenger information

4,000

3,500

3,000

2,500

2,000

1,500

1,000

500

0 MZA private operators Some statistics (2014)

Penalties for poor technical standards of vehicles

9000

8000 7000

6000

5000

4000

3000

2000

1000

0 MZA private operators New tender for the service (100 buses) in 2015

• Crucial meaning of experience from previous contracts

• New eco-criterions in the procurement

• New demands: – regural certification for the buses during the contract – higher penalties for important irregularities – high standards for the fleet maintenance facilities

• Incentives system for high quality performance (up to 4%)

• Quality of the service should be the same throughout the contract.

Modal Split (2005)

80.0%

70.0% 68.5%

60.0%

50.0% 45.6% public 41.4% transport 40.0% private cars 29.6% 30.0% others

20.0% 13.0%

10.0% 1.9% 0.0% Warsaw Metropolitan Area Number of trips

1.1 billion 1.08

1.06

1.04

1.02

0.98

0.96

0.94

0.92 2007 2008 2009 2010 2011 2012 2013 2014 2015 Thank You for attention! [email protected]

For info or further questions on the JASPERS Networking Platform, please contact:

Massimo Marra JASPERS Networking and Competence Center Senior Officer ph: +352 4379 85007 [email protected]